After 7 years of struggle in the cryptocurrency world, from the anxiety of entering the market with a principal of 60,000 to now breaking through 8 digits in my account, the pitfalls I've encountered and the liquidation stories I've seen are enough to write a 'pitfall avoidance guide'.
This industry is never short of 'technical experts', but those who survive are often not the best at drawing lines — but those who understand 'admitting mistakes and cutting losses' and execute simple rules to the extreme.
1. I've seen too many 'collapsing towers': holding positions is the culprit of liquidation.
In 7 years, I've seen too many scripts of 'building high towers only to have them collapse'.
Some people trade from tens of thousands to millions on short-term fluctuations, but in a bear market, they lose everything due to 'holding on during pullbacks'.
Some have made a profit in 100 consecutive trades, but because they were unwilling to admit their mistakes on the 101st trade, they gave back all their previous profits.
Are they technically poor? No! The mistake lies in treating 'luck' as 'skill', packaging a 'gambling mentality' as 'faith' — always believing 'if I hold on, it will come back', but the market never listens; holding on stubbornly when wrong is like sentencing your capital to 'death'.
2. The rules that allow you to survive are just 3 (if you implement them, you will profit).
I'm not a 'technical genius'; what got me here is executing simple rules to the extreme.
1. Always set a stop-loss when opening a position (ironclad rule).
No matter how 'certain' the market is, always set a stop-loss before opening a position — look at the 15-minute support for short-term trades, and key daily levels for medium-term, and exit if they break, without hesitation.
(Don't believe 'just wait for a rebound'; most of the time, waiting results in going from a 10% loss to liquidation.)
2. When emotions run high, turn off the computer immediately.
When continuously losing trades or wanting to 'go all in' after making a profit, immediately close the software and calm down! Emotions are the enemy of trading; decisions made when your head is hot will 90% make you regret it.
3. Don't be greedy for 'perfect points', only take 'certain opportunities'.
Don't always think about 'buying the dip and selling the peak'; being able to achieve 30% profit in the middle of a trend is enough.
(Only take 2-3 trades a week, focusing on opportunities where 'trends are clear + volume is supportive'; abandon unclear trends — less trading = fewer mistakes.)
3. Current market situation: opportunities exist, but rules must not be abandoned.
Market volatility increased in August, but the expectations for Bitcoin ETFs and the long-term logic of Ethereum ecosystem upgrades remain, providing plenty of opportunities.
But remember: Don't be blinded by 'good news'; rules > emotions!
Chasing short-term trends is fine, but you must set a stop-loss;
Medium-term strategies are also fine, but don't over-leverage;
No matter how crazy the rise, keep 30% cash as a backup; no matter how steep the decline, don't gamble on 'buying the dip' — preserve your capital, only then can you wait for the next wave.
4. The truth in the cryptocurrency world: only by surviving long enough can you make a profit.
I'm not teaching you how to 'get rich quick', but how to 'live longer'.
The cryptocurrency world is never short of opportunities; what's lacking are people who can 'follow the rules, admit mistakes, and cut losses'.
No matter if your current capital is 10,000 or 100,000, first thoroughly practice the 'rules for survival' — admit mistakes, don't hold positions, stay unemotional, and the market will naturally give you opportunities.
Remember: Those who are willing to admit their mistakes will always find a way to turn the tables in the market.
If someone is confused due to market fluctuations and doesn't know how to deal with being caught in a position or feels misled during their operations, feel free to communicate!
